HUGH NEVILL, Johannesburg | Tuesday
SOUTH Africa’s trade with the rest of the continent is booming since the end of apartheid in 1994, with its wine and food now a common sight on supermarket shelves in African countries.
The government, unlike its apartheid predecessor, encourages imports from other African countries as well as exports to them, but the relationship is largely one-sided given the overwhelming size of the South African economy in comparison with other African countries.
Exports to the rest of Africa are four-and-a-half times greater than imports, with the exports mostly manufactured products, though those to Europe are mostly primary and intermediate commodities.
“We are deliberately focusing in growing our trade with the developing world,” said Edwin Smith, representative for the trade and industry department.
“This is part of our global strategy. There is a clear focus on promoting trade on the continent and in the (14-nation) Southern African Development Community (SADC) region.”
Europe nevertheless remains South Africa’s biggest trading partner, with 40% of its total two-way trade, followed by Asia at 19%. Trade with the rest of Africa comes to 14%.
South Africa’s gross domestic product, $126,5-billion in 2000, is bigger than that of Finland, Portugal, Ireland or Greece, and the economy of the industrial province of Gauteng alone (Pretoria and Johannesburg) is bigger than any country in Africa except Egypt. South Africa’s GDP is 23 percent of the entire continent’s.
The Pretoria government has set up trade offices in Angola, Egypt, Ethiopia, Ivory Coast, Kenya, Mauritius, Tanzania and Zimbabwe, and has signed trade agreements with other African countries and set up binational commissions.
Eskom, the giant state-owned power utility, has won contracts in the past year or so to produce electricity in Lesotho, Libya, Malawi, Mali, Zambia and Zimbabwe, and is seeking more, and South Africa’s mining giants are also operating in many African countries.
In 1994, trade with Nigeria was worth just $12-million.
Last year, it was up to $400-million, with 55 South African companies doing business there, Business Day newspaper reported recently.
MTN South Africa is investing around a billion dollars in the Nigerian mobile telephone network, South African Breweries is investigating the market, and a hotel group is interested.
Even with Nigeria, though, the relationship is lopsided: oil accounts for 99% of Nigeria’s exports to South Africa.
MTN is also operating in Cameroon, Rwanda and Uganda.
Regional mechanisms include the establishment of the Southern African Customs Union (SACU) with neighbouring Botswana, Namibia, Lesotho and Swaziland.
It is a free trade union in which no customs or excise duties are paid and, as with the European Union, incidentally deletes the perk of duty-free shopping for travellers.
In 1999, neighbouring Zimbabwe was South Africa’s biggest trading partner in Africa, with two-way trade totalling 644 million dollars.
Now, with that country deep in economic chaos, Mozambique is overhauling it.
In the past four years, South Africa has signed agreements with the Maputo government which include setting up the Mozambique corridor, designed to uplift business development along a 500 kilometre road between the east coast port of Maputo and Johannesburg.
That project is expected to attract close to eight billion dollars in investments, and South African companies are also working with Mozambique to develop the harbours of Nacala and Beira to the north of Maputo.
Trade with Kenya last year amounted to some $124-million in exports and $3,7-million dollars in imports.
This included the export of vehicles, which amounted to some $8,4-million.
South Africa is also expanding trade into francophone Africa, exporting boilers and machinery to the value of 1.1 million dollars to Algeria last year, vehicles to the value of $2,6-million dollars to Senegal, and construction of a tourist complex in Gabon.
Total trade with the rest of Africa excluding the SACU countries amounted to $856-million last year in imports and $3,7-billion in exports, according to the trade and industry department. – AFP